EU ETS Factory Compliance Cost Set to Surge


Based on a factory that has emissions of about 50k t/yr, it will have 15k t shortage in 2020 as annual allocation of free allowances drops: says Louis Redshaw, founder of Redshaw Advisors in London, which buys and sells permits on behalf of factories, at Argus emissions conference in Amsterdam.

Factories looking further into future, w/ some seeking to hold 12 mos. of allowances in reserve; EU carbon allowance prices may rise to EU18/mt by 2020 from EU6.96/mt Wednesday at 4:22pm on ICE Futures Europe in London: Redshaw, citing Energy Aspects research. “Some companies that are already long are buying. The hedging behavior is having to change by necessity. It all adds up to companies getting shorter”.